FEATURED ARTICLES ABOUT FRITO - PAGE 2

The Eagle brand no longer will fly in salty snacks. In an expected move, Anheuser-Busch Cos. on Wednesday said it's bailing out of the snacks business it entered 17 years ago. The announcement comes less than four months after A-B said it would try to sell its unprofitable Eagle Snacks unit, which has had a difficult time competing with monster Frito-Lay. And who do you think will benefit even more from Eagle's departure? Why, Frito-Lay, of course, which agreed to acquire four of Eagle's five production plants around the country.

While other firms have put the bite on Frito-Lay's dominance of the $10 billion-plus salty snacks business, the PepsiCo unit remains undaunted. Frito-Lay, whose annual sales next year may be pushing $5 billion, up from a reported $4.5 billion in 1989, has responded with a flurry of new products in the face of of increased snack-foods competition from Borden, Keebler and Procter & Gamble. According to sources, Dallas-based Frito-Lay in 1991 will introduce to test markets a new curly-shaped snack called Suprimos.

PepsiCo likes to think that chips and pop are a marriage made in heaven. In fact, the soft drink giant would like them to nuzzle a little closer at retail outlets. So it took a big step in that direction Monday when its Frito-Lay division--makers of Fritos, Tostitos and other snacks--consolidated its sales promotion business, including its retail merchandising activity, with Omnicom Group's Tracy Locke Partnership, which already handles Pepsi-Cola's North American promotional business.

Snack-food giant Frito-Lay has settled its legal skirmish with Chicago-based Jays Foods over ads claiming that Chicagoans prefer Lay's potato chips over rival Jays. A Frito-Lay spokesman said Monday that the terms were confidential, but industry sources indicated that Frito-Lay agreed not to run any comparative ads with Jays for two years and to pay Jays' legal fees in the court battle. Word of the settlement came as Frito-Lay also issued a public apology after two Chicago radio stations inadvertently aired the ad on Monday in violation of a court order.

By George Lazarus, Tribune Staff Writer. Free-lance writer Brian Cox contributed to this story | October 9, 1997

Snacks juggernaut Frito-Lay Inc. now has Cracker Jack in its stable, via an acquisition from Borden Foods Corp. announced Wednesday. But the production days of this candy-coated popcorn are numbered in Chicago, where it first was sold at the 1893 Columbian Exposition. Terms of the acquisition were not announced. The deal by Frito-Lay, a unit of Dallas-based PepsiCo Inc., to acquire Cracker Jack ends nearly eight months of searching by Borden for a buyer. Borden acquired Cracker Jack in 1964 and moved its administrative and marketing offices in 1982 from Chicago to Columbus, Ohio, where the firm has headquarters.

A consumer watchdog group Tuesday announced a television ad campaign to warn viewers that eating Frito-Lay's new Max potato and tortilla chips, which contain the fat substitute Olestra, may cause diarrhea and cramps. "Olestra is simply not safe. A product like this should not be on the market," said Michael Jacobson, executive director of the Center for Science in the Public Interest. Frito-Lay's new fat-free chips are the first foods to be made with Procter & Gamble Co.'s controversial Olestra, the first calorie-free fat replacement.

A federal judge ruled Thursday that snack giant Frito-Lay must remove billboards and cease all advertising that claims Chicagoans prefer Lay's potato chips over local rival Jays. "I find Lay's misleading advertisement in identifying Jays potato chips as unflavored not only unsavory but totally tasteless," U.S. District Judge Samuel Der-Yeghiayan said in issuing the temporary restraining order. The judge took Frito-Lay to task for labeling Jays chips as "unflavored" during taste tests at three suburban Chicago malls last month, calling that "clearly derogatory" and aimed at convincing consumers to select the "classic" Lay's.

Police were investigating the reported theft of $200 in snack products from a Frito-Lay delivery van parked at Frito-Lay Inc., 481 Bonner Rd. The theft was reported Sunday, police said. Entry to the van was gained by prying open the rear sliding door, police said.

A federal judge on Wednesday ordered that Frito-Lay Inc. turn over to rival potato-chip maker Jay Foods by noon Thursday documentation backing up its claim in ads that Chicagoans "prefer the taste of Lay's over Jay's." On Monday, Jays, a Chicago snack-food company, filed a lawsuit alleging that the Frito-Lay ad campaign was false and misleading. Attorney Roger Pascal, representing Frito-Lay, disputed assertions by Jays that it had refused to provide test results to substantiate its ads. U.S. District Judge Samuel Der-Yeghiayan refused to allow Frito-Lay to keep parts of its documentation confidential, saying the public has a right to know.

Emilia D. Knopp, 77, a resident of Lombard since 1960, died Friday in her home. Mrs. Knopp had worked for International Harvester Co., Keebler Co. and Frito-Lay; she retired from Frito-Lay in 1981. Survivors include her husband, Walter; two daughters, Dawn Max and Bonnie Hall; a sister; and five grandchildren. Services will be held at 1 p.m. Tuesday in Holy Trinity Lutheran Church, 350 E. Madison St., Lombard.